Millionaire migration following tax hikes a myth, study finds

For California millionaires, personal connections seem to weigh more heavily than tax rates in deciding where to live, the researchers found. Credit: Andy Z. / Shutterstock

(Phys.org)—Anti-tax advocates argue that millionaires will flee from states that raise taxes on their highest earners. But a study by Stanford and Princeton researchers shows no evidence of millionaire migration in response to recent tax rate changes. Other factors, such as personal and business contacts, seem to weigh more heavily in deciding where to live.

Embroiled in the California debate over Proposition 30's progressive income tax proposals, some politicians have argued that raising taxes on the highest earners will drive them to states with lower tax rates, taking businesses and jobs with them.

But a study released by the Stanford Center on Poverty and Inequality concludes that "millionaire migration" is simply a myth.

Stanford's Cristobal Young, an assistant professor of sociology, and Princeton's Charles Varner, a doctoral candidate in sociology, conducted the study at the request of the California Board of Equalization, allowing them unique access to California Franchise Tax Board income data.

The mountain of data included information from all state income tax records for California from 1992 to 2009. The result of all that data crunching? The migration of millionaires in and out of the state has almost no relationship to tax increases or tax cuts.

Young said that having access to such comprehensive data allowed him and Varner to contribute compelling evidence to the income tax debate. "I think it's important that we can bring really high quality data to these kinds of issues," Young said.

The immense dataset, though a goldmine, also represented a challenge for the researchers, who pored over more than 300 million data points. "It was an entirely different technical world," said Young. "You have to be extremely careful with this kind of data. Everything gets triple checked and code reviewed."

The findings are consistent with the results of a study the team led in New Jersey last year.

The reason the number of California millionaires varies from year to year has almost nothing to do with taxes, the researchers found. Instead, the numbers change as incomes fluctuate, most likely because investments are sensitive to market cycles.

Varner and Young looked at millionaire migration after California's 2005 Mental Health Services Tax was enacted, as well as after state tax cuts in 1996.

They found that millionaires did not flee as a result of the tax increase (in fact, more millionaires moved into the state than out during that period), nor did millionaires from elsewhere move to California as a result of the tax cuts.

Evidence of tax flight 'hard to find'

What could account for the fluctuations in California's millionaire population? According to the study, it's not due to tax changes or rich people leaving the state. Almost all of the fluctuation comes from income dynamics at the top, with taxpayers falling into and out of the millionaire income bracket as their income rises and falls across the million-dollar mark from year to year.

The temporary nature of such high earnings may help explain why the additional taxes in the study didn't cause a noticeable flight of millionaires.

Personal connections seem to weigh more heavily than tax rates in deciding where to take up residence. "People are tied to states for different reasons," Young said. "They don't want to take their kids out of school, they want to stay connected with friends, with families … with business contacts." People crowd together, from Silicon Valley to New York City, because of the returns associated with collaboration, he said.

The study's findings seem to dispel the "market metaphor," in which states advertise their low tax rates in a competition to woo high-income individuals. "This is a poor representation of how people decide where to live," Young said.

Young added that looking at the tax flight issue only scratches the surface of state financial woes. "People need to think about the depth of California's budget problems," he said. "I think there's much, much bigger things to worry about than this issue of tax flight because it's really hard to find any evidence of it."

The researchers hope to perform similar analyses in Maryland, Oregon and Washington – eventually comparing trends across states.

"I hope people hear, listen to and absorb what the evidence says on this issue," Young said.

(PhysOrg.com) -- Few elderly homeowners are forced to move from their homes because of property tax increases, according to a new study from a University of Wisconsin-Madison public affairs researcher and economists at the ...

Tax increases are the only solution to a widening budget crisis that a new study says has landed Illinois among the nation's most financially troubled states, a soon-to-be-released report by a team of University of Illinois ...

Recommended for you

Sixty-six million years ago, the world burned. An asteroid crashed to Earth with a force one million times larger than the largest atomic bomb, causing the extinction of the dinosaurs. But dinosaurs weren't the only ones ...

Have you ever felt the urge to cross the road or move seats on a train after a conversation taking place nearby suddenly becomes aggressive? Well, for the first time a scientific study has shown how the size of your interpersonal ...

An international team of researchers has found that people around the world rarely say "thank you" to those closest to them. In their paper published in the journal Royal Society Open Science, the group describes their study ...

The researchers hope to perform similar analyses in Maryland, Oregon and Washington – eventually comparing trends across states

Yeah i would be really interested(maybe not so much) in the results of those future studies. First off this study was conducted by none other than Stanford and Princeton and like a vast majority of IV leage schoolsZ(if not all of them) they are liberal cesspools and hopelessly biased. Look at the top contributors to Obama in 2008 and this year:https://www.opens...00009638http://www.opense...00009638Approximatly half of them are universities. McCain 2008 and Romney 2012?:http://www.opense...00006424http://www.opense...00000286I don't see many contributions from universities to Republicans.

Now for the economics. Call me self righteous but it's fairly self evident that the more someones taxes are raised, the less likely that someone is going to increase production. Why would an individual work harder if harder work is disproportionally punished? Why stay? The more production, the more profit, the more tax revenue. Its called supply side economics and larging the base of tax payers. What logic does the government mandated Federal Reserve go by when it tries stimulate the economy? It lowers interest rates or the cost of taking out loans which lowers the cost of doing business. When it wants to slow down the economy, it raises interest rates(like raising taxes). What logic do government taxes like long term and short capital gains taxes go by? ST capital gains taxes are supposed to disincentivize in year trading/economic activity with higher taxes. LT capital gains taxes are suppose to incentivize trading with LOWER TAXES on duration trades of over a year.

One need not look any further than Braeburn Capital for an example of how smart money avoids high tax rates. Wealthy individuals use the same methods as Apple does in avoiding taxes, they may not move but their money and businesses do.

It is very likely California, with its attractive climate and natural resources, creates a captive tax base, meaning most high-income earners will not move unless taxes become punitive. Moving away is the toughest and most costly response to a tax increase. Soak-the-rich types should not celebrate because this is probably the exception rather than the rule. I'm fairly confident if South Dakota(known for its weather) introduced a highly pRegressive income tax scheme similar to California, they would see a swift exodus of high-income earners.

1992 through 2009 is a mere 18 years of one State and has no mention what California State taxes increased during this period and what decreased or when. Nor does it explore tax rates at the same time in other locales. Nor does it look at long term tax rate trends and changes and high income earners ploted against it. Also no analysis of newly risen ranks within California to millionaire rank (a very big segment of California's upper income is newly risen). Calif real estate created 10,000s of new millionaires during the time studiedWe also don't see any discussion in the article of if these Millionaires tests to see what marginal tax brackets those the moved in and out of the State were. As we all know, many millionaires do NOT pay marginal rates and are not effected by changes in those marginal rates and thus the entire premise of the study may be flawed since those people experienced ZERO tax rate change.

The majority of Americans fret over tax rates of rich individuals (1~5% of the population), who personally employ next to no-one (Forbes richest 400 list personally employ about 2,000 people, if that..) but companies, which employ the vast majority of Americans, pay 35% tax in the USA and 15% in Canada who don't mind taxing lazy rich individuals who may well scurry down to the USA and invest their money in bank shares ~ how many poor people or struggling middle class will they help to employ??? (none)

raising taxes on the highest earners will drive them to states with lower tax rates, taking businesses and jobs with them

They're already doing it at the international level - or not (1, 2)? We are discussing it here every month. Why the global companies should move from Alabama to Texas just for slightly lower tax, when they can move their business to the tax paradise at Bermuda islands?

If you are really rich, you have a choice of where you want to live. Raise the taxes there and it is still a paradise to live there. OK, Cali gets really high taxes. So move to Mexico or some other nation. These places are warm, tropical, and have dirt cheap wages......until the wolf shows up at the door complete with ten or so kids carrying AK-47s wanting whatever, and BTW they have your daughter of whatever age, wife, or son, mother or whoever that they just 'collected' at the local store. Now they want YOU! Rest of this story is all downhill. Point is: WHERE YA GONNA GO, CREEP?! Behind every fortune is a secret crime! Capitalists dispute this mostly because they are themselves criminals fearing discovery, and hypocrites too...hey weak character in one way, why not another. Bottom line: the rich ain't moving, but they will try to corrupt their way out of any jam just like the recent election--use Citizens United..da best 'supreme court justice' money could ever buy!

I did my part, campaigning for Dr Raul Ruiz in Riverside County California to get rid of one particularly noxious and virulent teapartyfascist, Mary Bono Mack. Just like war, you get them before they get you...and this traitor to America and its workers never met a job she did not want to export to China, never saw a municipal service she did not want to 'contract out'

This 'lady' also wanted to call all retirement systems 'social welfare' or 'entitlement programs' to make them targets for the foolish who had contempt for human life; and she never met any wealthy folks she would not prostitute her profession to and prostrate herself before, nor any international hoodlum monopoly cartel unlikeable.

I am proud to have helped subtract the population of hideous monsters in congress by one. This is the American Way at its most honorable.

Multi-millionaires with passive incomes can pretty much live where they want. A bit extra tax won't affect THEM too much.But, if these millionaires are actively trying to build and expand a business, which generates more wealth, have many lower tax choices and many take it.Why did Sweden END its tax on wealth.""The big winners are, in the long term, all Swedes, because we need to have the conditions for jobs and companies necessary to match global competition. One issue is that little money stays in the country. There has been a big discussion in recent years about how globalization makes capital more and more non-national and harder to keep within national boundaries," he said.

"The downside to such a tax strategy is the fact that people are already leaving California in great numbers. According to a Manhattan Institute study, "The Great California Exodus: A Closer Look," by Thomas Gray and Robert Scardamalia (October 2012), roughly 225,000 residents leave California each year — and have done so for the past 10 years.""They take their money with them. Using census and Internal Revenue Service data, Gray and Scardamalia estimate that California's outmigration results in large shares of income going to other states, mostly to Nevada ($5.67 billion), Arizona ($4.96 billion), Texas ($4.07 billion) and Oregon ($3.85 billion).""California has one-eighth of the nation's population but one-third of its welfare recipients."

"Apple Inc., famously founded in California, is building its next expansion in Austin, Texas, a $304 million campus with 3,600 employees.""On the California June ballot, Proposition 29 would raise the cigarette tax another $1, bringing the price of a pack of cigarettes to $7.""The consequence is that the tobacco tax revenues are declining and nonsmoking taxpayers are now on the hook to repay the bonds."http://capolitica...-spiral/

"More than $5.3 billion in net adjusted gross income has left California counties for the greater Las Vegas region. Californians account for 46% of all working wealth that has moved into the Las Vegas area since 1995. States without a personal income tax, like Nevada, know that what is produced in Vegas will stay in Vegas.http://www.forbes...n-vegas/

CA may keep their idle rich but the working 'rich' are moving out.Movie producers and some actors may stay in CA, but why have so many productions moved out of California?

You 'progressives' keep on whistling past the economic graveyard you are creating. Eventually, you run out of OPM.But why don't you think those super rich paying the CA bills won't demand more special favors from Sacramento?Maybe this will drive out more illegal aliens from CA. CA will soon be just like the turd world they left.

" New York Mayor Michael Bloomberg called it "dumb" to raise taxes on the wealthy, and later pointed out they would leave New York, pointing to France as an example.

"You saw in France people moving out when they raised the tax rates," Bloomberg said, according to the New York Post on Oct. 13. "Whether you like it or not, the wealthy are mobile.""http://cnsnews.co...-percent

Maybe a bit flawed study. The best question would be to check how high income change (regardless of reason, tax rate is a less important factor here) would motivate person to move.Then to calculate, how high tax rate increase would actually have the same impact of annoying someone enough to move away.

Plus the above mentioned study assumes somewhat immediate reaction. My taxes got increased by 1% so I flee away in panic overnight... Surprising that they found no such impact... ;)

(however, long term expectations concerning tax rate and quality of government service should matter somewhat)

How much are you willing to wager on that lie, ryggie? You never replied me about why corporations need to be sanctioned by the state to operate. Or do you propose abolishing corporations as organs of SOCIALISM?

Of course if you look at some data like acres/capita by state OWNED by the federal govt:AK 350.23WY 56.78MT 30.47NV 23.29ID 22.33NM 14.00UT 12.83OR 8.91SD 5.18CO 5.14ND 4.99AZ 4.89WA 2.10AR 1.76CA 1.35

How does the federal govt create tax revenue on the property it owns? Depending upon the property, it can be quite expensive to maintain. Major military installations like Minute Man silos, national parks, national forests, national monuments, national grasslands, BLM lands, .....Nuclear labs in ID, NM and WA.

The most egalitarian state, WY is quite red and they were even the first state to stop denying women the right to vote. In the west, content of character is more important than color, pedigree, or education credentials.

Koch, it is the 'liberal' who wants to make the rich poor.It is 'liberal' laws that kill profits and destroy jobs.

"Three days after the re-election of President Barack Obama, consequences are being felt. Dozens of companies have announced layoffs since Tuesday's election, and the list is expanding rapidly."http://www.examin...election

I understand the Libtards believe that "income disparity" must be the fault of others.That is why they are Libtards...or at least ONE of the reasons. Libtards like VD, Caliban and kochevnik are so wrapped up in their emotions re: the poor, but they have no desire to see those "poor" stay in school and pay attention to schoolwork, etc., and then graduate and get a good paying job. Noooo...that would be the end of Liberalism when the poor actually DO something to HELP THEMSELVES. Libtards enjoy their role of the "bleeding hearts".Libtards REFUSE to put the blame for poverty squarely where it belongs...on the individual. And Libtards don't want to admit that these "poor" are poor only BECAUSE they don't want an education and don't want to work for a living. Like the song goes, "I don't wanna work, I just wanna bang on the drums all day."

Libtards REFUSE to put the blame for poverty squarely where it belongs...on the individual. And Libtards don't want to admit that these "poor" are poor only BECAUSE they don't want an education and don't want to work for a living.

Yes and I am sure your poverty of intellect is due to your free choice to drink wood alcohol as an adolescent.

And I am sure whoever is supporting you as you sit at home sweat-staining your couch and eating those ice cream bon bons, works very hard and is reasonably well-educated. And more than a little desperate.

Income disparity = the fault and responsibility of those who refused an education and instead chose poverty

-And dont forget those who refused college educations and were subsequently drafted, sent to vietnam, and maimed for life. Serves them right eh you imbecile?

Blotto...your imbecilic and simple-minded attitude toward me clearly reflects and defines your insanity, your jealousy and your inability to get along with everyone. But I am only one out of many with whom you attempt to elevate yourself, but only result in proving that you're simply a little piss-brained twirp desperately trying to prove your macho or machismo, which is proven to be nonexistent in either reality or ether.

In spite of your obvious lack of knowledge, you pretend to have a practical understanding of subjects from which you are far removed except for your ability to reference websites like Wiki, rather than having cracked open textbooks and periodicals, and listened to the learned (which position you can never hope to attain), as well as written a proper thesis. These are all reasons for which you have no business commenting on a science website anywhere and anytime.

Libtards REFUSE to put the blame for poverty squarely where it belongs...on the individual. And Libtards don't want to admit that these "poor" are poor only BECAUSE they don't want an education and don't want to work for a living.

Yes and I am sure your poverty of intellect is due to your free choice to drink wood alcohol as an adolescent.

And I am sure whoever is supporting you as you sit at home sweat-staining your couch and eating those ice cream bon bons, works very hard and is reasonably well-educated. And more than a little desperate.

Income disparity = the fault and responsibility of those who refused an education and instead chose poverty

-And dont forget those who refused college educations and were subsequently drafted, sent to vietnam, and maimed for life. Serves them right eh you imbecile?

Income disparity = the fault and responsibility of those who refused an education and instead chose poverty

-And dont forget those who refused college educations and were subsequently drafted, sent to vietnam, and maimed for life. Serves them right eh you imbecile?

-Blotto

During the Vietnam War era, there were many young guys who opted for a college education in order to avoid the draft. But many wound up being drafted anyway because they were not college material. In other words, they were not intelligent enough and failed college entrance exams. Others fled to Canada and became personae non gratae.

The words that you enjoy using, such as imbecile, moron, and others clearly explain what a very bitter and thoroughly dissatisfied person you are. You seem unhappy because I am still here, commenting on what you regard as YOUR VERY OWN domain, as though you OWN this website. You continue to prove that you are a very sick person, full of jealousy and hate. Too bad.

Naw I know better than to pretend to be a nurse or a farmer or a russian or an engineer or a NASA worker, on a site frequently visited by people who actually ARE these things. You however are too dumb to realize that you cant DO this successfully. And you cant hide in new suckpuppets because your unique imbecile signature (UIS) always gives you away.

The words that you enjoy using, such as imbecile, moron, and others

Well I TRY to be creative but there are only so many words useful in discussing your UIS.

Yes that is why Socialist Norway has nearly the highest per-capita income and the highest hourly wages and the longest longevity. Hell on Earth for you.

But its not due to socialism."Scandinavian countries are "socialist" in some senses and vibrantly capitalist in other senses. They are "socialist" in the sense that they have very high taxes with very generous social welfare services provided by the state, the famous "cradle-to-grave" welfare state. They are vibrantly capitalist in the sense that they have low levels of interference in markets by the government, low levels of regulation, low levels of nationalization of industry and capital, and almost no protectionism. "http://frontpagem...sm-work/

"So Scandinavian "socialism" is doing a remarkably poor job in eliminating poverty among non-Scandinavians living in those Scandinavian utopias.

The conclusion can only be one thing. The low poverty rate among Scandinavians in Scandinavian countries is thanks to the fact that Scandinavians work. It is NOT because socialism works!"http://frontpagem...-work/2/Scandinavian culture plays a major role in their success. Jante's law is one major factor and a homogenous society another. Compare US states with major Scandinavian immigrants and you will find them to be successful not because of socialism.Immigration, especially Muslim immigration, is straining their success.So, Koch, do you support how the Scandinavian countries leave businesses alone and respect property rights?And koch, are willing to publish your tax returns on-line as they do in Norway?

"Thefact that Sweden itself has abandoned this tutorial or maximalist Welfare State model is notwidely known.7 For over a decade now, Sweden has been on a comprehensive and promisingquest for an alternative to its old Welfare State, wherein the state still plays an importantrole but does not exclude a number of social and economic players who can jointlycreate a welfare society that grants""If I were to fall ill today,I would undoubtedly go to the closest clinic, Nacka Närsjukhus, managed by a for-profitprivate limited company like many others in the province of Stockholm. I would havecomplete freedom of choice and would not have to pay more than if I had chosen to goto a public clinic."Sweden after the Swedish ModelFrom Tutorial State to Enabling StateMauricio RojasHow many 'progressives' support vouchers for school choice? Sweden does. So yes, let's take a closer look at the success of Sweden.

"Almost two-thirds of the country's million-pound earners disappeared from Britain after the introduction of the 50p top rate of tax, figures have disclosed. ""In the 2009-10 tax year, more than 16,000 people declared an annual income of more than £1 million to HM Revenue and Customs.

This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election. ""It is believed that rich Britons moved abroad or took steps to avoid paying the new levy by reducing their taxable incomes.

George Osborne, the Chancellor, announced in the Budget earlier this year that the 50p top rate will be reduced to 45p from next April. ""Far from raising funds, it actually cost the UK £7 billion in lost tax revenue. "http://www.telegr...ate.htmlHigh rated reduce revenue. It's well documented.

"The Rand Corporation recently issued a report that indicates that the SSDI program could become bankrupt within four years. According to the report, the program is paying more money than it takes in and the funds could be depleted by 2016."

Hey ryggy ask yourself the question... Where would SS be today if, instead of paying all that money into IRAs which have been periodically and systematically looted since 1974, it had been payed into SS with a guaranteed rate of return?

I tell you what would have happened. A huge investment industry would not have been created whose main function is to charge exorbitant amounts of money to interpret complex investment policies; this money would not have been available for looting by unscrupulous industry insiders; and SS would be alive and well today.

But vastly smaller investment markets would have been left critically vulnerable to malevolent manipulation. IE it was broke to begin with. And so retirement money was used as a temporary fix.

Didn't Britain re-enter a recession just before the number of reported millionaires decline?

Why.. Yes it did.

And wouldn't the number of claimed millionairs offset claimed losses from several years previous to several years following in order to temporarily reduce their incomes in order to avoid the increase in the tax?

Why, yes they would...

Are either of these situations permanent?

Why.. No, they are not.

Is RyggTard dishonestly engaging in deception?

Why.. Yes... Yes he is.

"This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election." - RyggTard

And how do we know that RyggTard is repeating lies?

It is simple... He says so himself...

"it actually cost the UK £7 billion in lost tax revenue."

A fixed reduction in revenue can not come from a fixed rate of payment over an infinite period of time.

Hence the fixed "loss" represents a finite time and hence acks that the reduction is temporary.

(cont) -A fix which left wage-earners critically vulnerable to malevolent manipulation. 'Broke to begin with' = Ponzi scheme. Investments which wax during the growth phase of an economic Cycle wane during the decay phase.

But markets cannot shrink peacefully, they have to COLLAPSE as investors all scramble to get out first. So Leaders devised a way to guarantee that a vast pool of sluggish, hapless investors COULD NOT scramble to cash in their FORCED retirement investments before the investment industry itself was out, thereby preserving a valuable wealth generator at the expense of throngs of workers who were no longer productive.

Kind of reminds me of how jewish usuary lenders were welcomed into an area to spur growth and prosperity, only to abscond with the profits when the economy invariably began to sink, leaving their hapless communities behind to suffer the pogrom.

People wonder what happened to the kohannan after the temple fell. Well they became BANKSTERS didnt they?

Deception is humanitys greatest asset, its most valuable attribute. 'All of war is deception.' And since peace is ALWAYS only the preparation for war, then all of peace is necessarily deception as well.

Look. Our politics are founded upon the idea that politicians will be promoting the wishes of at least some of the people, some of the time, despite their personal views. A lawyers art is based on deception. We are entertained and informed by actors, pundits, talking heads, and salesmen who are pretending to think, feel, and BE what they most obviously are NOT.

And the most convincing deception of all has made us believe in omnipotent, omniscient spirits who will give us immortality and free gifts in return for our devotion.

We are conditioned to distrust honesty. We have been selected for this. This is what domestication IS. Cut poor ryggy a little slack will you? Hes a mensch just like you (but not me, no).

" Quite a few of France's most wealthy already have moved abroad to avoid the country's stiff inheritance and wealth taxes. Now, real estate agents say, the younger, working wealthy also are on the move, unhappy at the prospect of being taxed at 75 percent on income of more than €1 million, or $1.27 million, and a capital gains tax of more than 60 percent on stocks, bonds and company sales, although protests have produced exceptions for investors and new business start ups.

"In the last eight months since the measures were revealed, over 400 new residences, each worth above €1 million, have come on the market as French entrepreneurs and investors leave France,""http://www.nytime...tml?_r=0

"In the 1990s after the collapse of the Soviet Union, the country's main benefactor, the Cuban government imposed a few scattered taxes, but mostly preferred to maintain low wages so it could fund free social services.

The government's free market reforms introduced over the last two years, are designed to encourage small businesses, private farming and individual initiative, along with plans to pay state workers more. Under the new tax code the state hopes to get its share of the proceeds.

The government also envisions replacing subsidies for all with targeted welfare, meaning that the largely tax-free life under a paternalistic government is on its way out."http://www.cnbc.c...49989684They ran out of OPM.

RyggTard is quite the gullable fool. That is why his Libertarian masters consider him a "useful idiot".

Here RyggTard quotes from an authority in finance - a realestate agent.

Bahahahahahahahahaha.....

"Quite a few of France's most wealthy already have moved abroad to avoid the country's stiff inheritance and wealth taxes." - RyggTard

Sorry Tard Boy, but those homes are being sold so that the owners can avoid paying tax on them when they sell them in the future provided the tax you claim is causing them to move, actually becomes law. It hasn't.

So RyggTard, there is no mass migration out of France. It is just another one of your QuackTard Libertarian/Randite delusions like your long disproved claim that lowering taxes increases tax revenues, or that welfare causes poverty.

Former Republican officials in Florida have admitted a controversial new law that helped fuel massive lines on Election Day was intentionally created to suppress Democratic votes. Republican leaders had claimed the law was aimed at stopping voter fraud. But former Republican officials, including former Florida governor Charlie Crist, told the Palm Beach Post that alleged fraud was used as a cover to conceal the main goal of Republicans — curbing Democratic votes. In particular, Republican officials were apparently concerned about the impact of early voting by people of color. The Palm Beach Post cites an anonymous Republican consultant saying: "I know that the cutting out of the Sunday before Election Day was one of their targets only because that's a big day when the black churches organize themselves."

Quite a few of France's most wealthy already have moved abroad to avoid the country's stiff inheritance and wealth taxes. Now, real estate agents say, the younger, working wealthy also are on the move

See this is one of the advantages of a world govt. People will be forced to pay their fair share wherever they go. Nobody gets a free ride no matter how clever or ruthless or well-connected they may be. The Singularity will watch over us all.

Where would SS be today if it were a real trust fund and not a Ponzi scheme?

IRAs are a ponzi scheme because they imply guaranteed returns but in fact depend entirely on markets, which is only gambling. Social security is a govt-guaranteed pension. It is failing because the money which SHOULD be flowing in, is being gambled away in investment markets. OF COURSE there is less money in SS than there was pre-1974. People were duped into a promise of quick returns but instead were placed in control of market manipulators who were well-acquainted with economic cycles, and knew that this massive influx of money would be easy to steal.

Why shouldnt retirement money be guaranteed? I didnt choose to gamble with mine, I had no choice, just like millions of others who watched it evaporate in 1980, and 1990, and 2001, and 2007. Should I pay $1000s to try to protect it this time, or just watch it evaporate again? Why shouldnt I expect it to be at least as safe as if it were buried somewhere?

That is NOT how it was sold and who it was supposed to work, but now SS is a tax like any other tax with no real connection to the funds input and the funds received.An IRA is tax deferred PRIVATE funds that are really saved into accounts the govt can't spend but can be loaned to create more wealth.

Apparently RyggTard thinks that the tens of trillions of dollars of Social Security should be held in some magical bank account where it will remain locked away from the economy until it is redeemed by the payer.

"Where would SS be today if it were a real trust fund and not a Ponzi scheme?" - RyggTard

The alternative of course would be to lend the money and fill the world with 9 times as many dollars due to the multiplier effect - to the tune of $300 to $400 trillion dollars.

RyggTard apparently thinks that flooding the global market with such spectacular volumes of American currency would somehow have been beneficial as it would drive the value of the American dollar into the ground.

Too many dollars chasing too few goods is, of course, a prescription for massive economic failure, and more evidence of why Libertarian/Randite economics has been such a spectacular failure wherever it has been tried.

America's current fiscal situation is a direct result of Libertarian/Randite eco.

"That is NOT how it was sold and who it was supposed to work.." - RyggTard

RyggTard is blissfully ignorant of the fact that the SS surplus has since the creation of SS, always been a government stimulus and infrastructure program.

The idea is to fund improvements in the infrastructure of the U.S. which stimulate economic growth that will pay for the improvements and allow the economy to grow fast enough to pay the SS claims made by the retired.

In fact it has largely been the SS surplus that has increased the life expectancy of Americans to the point where they now remove more from the SS program than is put in.

This is easily solved by increasing the retirement age.

A very reasonable thing to do given the fact that Americans now love longer due to the existence of Social Security.

An IRA is tax deferred PRIVATE funds that are really saved into accounts the govt can't spend but can be loaned to create more wealth.

-Or plundered of wealth as it has been at least 4 times during my career. And I cant even afford at this point to move it around in order to protect it from the fiscal cliff. Is this cliff some construct meant to churn IRAs to generate some pocket change for investment banksters? Pay up or lose - again??

Why should I be forced to contribute MY money to create wealth for somebody like madoff? Did I vote for this?

Too many dollars chasing too few goods is, of course, a prescription for massive economic failure

This is the decay phase of an economic cycle, where prosperity-fueled pop growth begins to exceed available resources. As you say it is shortly and inevitably followed by collapse. Or traditionally, by pogrom, war, revolution.

In fact it has largely been the SS surplus that has increased the life expectancy of Americans to the point where they now remove more from the SS program than is put in.

This wouldnt be a problem if 401k money had gone into SS instead of investment markets.

This is easily solved by increasing the retirement age.

-Except that tech is evaporating jobs far faster than they ever will be replaced. Delaying benefits only means death for more people. THAT is your easy solution. Thats what they came up with in germany for the craftsmen after the revolution. That, and war, and the 2nd reich.

Maybe we should look forward to the pan-american union and the amero after the dollar collapses.

Work, which can be taxed, is still being done done by machines. Lost revenue can STILL be recovered to support displaced workers. We only need to figure out how to tax machines directly for the work they do; and this would mean paying them directly for it.

"SocialSecurity was presented as "retirement insurance"under which taxpayers pay "insurance premiums"or "contributions" to "buy" protection from destitutionin old age, with their "contributions" being"held" for them in a "trust fund" which will beused to pay benefits which, having been "paid for"by their "contributions," will be theirs "as a matterof earned right," as America keeps its "compactbetween the generations."The entire foregoing description is demonstrably,documentably false."THE ROOTS OF THESOCIAL SECURITY MYTHBY JOHN ATTARIAN

From their inception 401K's were designed to pump trillions into the investment market to compensate for the low savings and investment rates of the American Consumer.

Those who opposed the 401K plans were very clear that they were nothing short of gambling with retirement funds.

"This wouldnt be a problem if 401k money had gone into SS instead of investment markets." - Otto

It wasn't so long ago - before the era of massive Republican Fiscal mismanagement and treason - that Americans would boast of the size of their 401K accounts.

The 401K meltdown started of course with the Republican deregulation of the Savings and loan industry, which in addition to depleting the 401K's of millions of Americans, also gave American middle class the gift of a half trillion dollar bailout of the S&L industry.

A trust fund is a financial tool that holds and administers assets for the benefit of another person or organization, called a beneficiary. The initial assets for the fund are provided by a grantor or donor, and a trustee or team of trustees manages the funds according to that person's instructions. The beneficiary receives payment from the fund as a lump sum or in periodic installments, according to the terms of the trust.

One of the reasons people didn't save money in the 70s was inflation. If your money keeps losing value and interest rates don't compensate, don't save, spend and even better, borrow and spend since you mah pay it back with even cheaper inflated currency, which is what most govts do.Not much has really changed except the govt has found ways to hide the inflation in market and housing bubbles.

The plan is in the works to nationalize, aka STEAL, PLUNDER, all 401ks and other retirement plans.

Excellent. As the govt is after all the PEOPLE isnt it? Whats the name of this plan?

It wasn't so long ago - before the era of massive Republican Fiscal mismanagement and treason - that Americans would boast of the size of their 401K accounts.

Yeah I remember a guy at work whos 401k was over $1M. This was before 2001. It has probably recovered somewhat. I remember interviewing with an older executive, lamenting his IRA. 'SO MUCH money was lost.' -he lamented. He seemed genuinely distressed.

Mine just went up 20% or so in the last year. Why? Who knows? Ripe for plunder once again? The fatted calf? I suppose it never was my money, but some kind of tax I paid to support the greater financial industry, and I should expect never to see any of it. Oh well.

"Germany levies a church tax, on all persons declaring themselves to be Christians, of roughly 8–9% of their income tax, which is effectively (very much depending on the social and financial situation) typically between 0.2% and 1.5% of the total income. The proceeds are shared amongst Catholic, Lutheran, and other Protestant Churches."

Odd how you attribute the housing bubble to Da Gubdermnent, when Alan Greenspan testified in front of Congress that it was the ideological failure of Randite/Libertarian free market economic policy that was the ultimate cause.

"Not much has really changed except the govt has found ways to hide the inflation in market and housing bubbles." - RyggTard

Given that Alan Greenspan was the greatest ideological disciple of Ayn Rand, it would appear that he has slightly more credibility when it comes to such attributions that you have in denying them.

Americans like RyggTard are particularly prone to becoming Corporate owned Cattle because they have been born and psychologically manipulated into believing that being part of a corporate controlled cattle ranch is the best and only way to live.

The magical God they call the "free market" demands it along with their free subservience to it's loving dictates.

Social Security would be solvent forever if rich leeches like Jon Swenson (ryggesogn2) didn't take what they don't need.

Even accounting for these leeches, social security is solvent until I believe 2075 at 85% of current benefits.

SS is a Ponzi scheme and I have been lied to ever since I started paying in to SS. The retirement age as increased, the TAX rate has increased AND the income limits have increased since I started paying SS TAX in 1979.But I will take out the most money I can from the system I paid into.Now if the socialist admit SS is tax and has nothing to do with real insurance, they will acknowledge FDR's lie.Since the Obama regime has supported cutting the payroll TAX, they acknowledge the TAX has NOTHING to do with any 'trust' fund that is put into a 'lockbox' for those who pay the TAX.

SS is not a ponzi scheme because 1.) the benefits to payout ratio is not outrageous. It's designed to run on a 3:1 pay-in to pay-out ratio, because demographically there's generally always about 3 times more people of working age than there are elderly. 2.) SS does not offer continually increasing returns. Its returns are a function of law, and if anything, its returns have decreased lately due to increases in the retirement age and increases in the tax. 3.)You can't withdraw your investment in the SS fund arbitrarily. You get your payout when you reach retirement age, as laid out by the law. There's no possibility of a "run" on SS, so it's lack of putative "solvency" is a non-issue. It's not buying or selling assets. It's only transferring some financial assets from workers to retirees. And not really that much, about 1/6th of the first ~$100,000. To buy elderly Americans some dignity in their final years. Of course, it'd be better if it were 1/10 of all income.

because demographically there's generally always about 3 times more people of working age than there are elderly.

Since when?

There's no possibility of a "run" on SS, so it's lack of putative "solvency" is a non-issue.

Of course there is. It occurs when the US govt runs out of other people's money. We are witnessing some examples now with cities and companies going bankrupt due to unfunded entitlements like retirement. The same WILL happen to SS and every other unfunded entitlement.

You get your payout when you reach retirement age, as laid out by the law.

How doe the LAW obtain money when it's gone? Plunder, print it? BTW, Congress can CHANGE the law anytime.

"Payroll taxes exceeded benefit payments regularly until 2010. But the fact is that Social Security has now passed a tipping point, beyond which the Congressional Budget Office projects that it will permanently pay out more in benefits than it gathers from Social Security taxes. The imbalance is made even larger this year by a one-year "payroll tax holiday" that was enacted as part of last year's compromise on extending the Bush tax cuts. The lost Social Security tax revenues are being made up with billions from general revenues that must all be borrowed. The combined effect is to add $130 billion to the deficit in the current fiscal year."http://www.factch...red-ink/

SS is a Ponzi scheme and I have been lied to ever since I started paying in to SS. The retirement age as increased, the TAX rate has increased AND the income limits have increased since I started paying SS TAX in 1979.

BECAUSE money which would have gone into it at increasing rates was instead put into 401ks where it could be periodically and systematically LOOTED to create wealth for buying yachts and property in the caymens.

"Payroll taxes exceeded benefit payments regularly until 2010. But the fact is that Social Security has now passed a tipping point, beyond which the Congressional Budget Office projects that it will permanently pay out more in benefits than it gathers from Social Security taxes.

So to FIX it we acknowledge the CRIME and redirect 401k money back into SS accounts where it belongs. 'But this will crash the markets AGAIN and destabilize the free world AGAIN.' -you say. Yeah, but this time it wont be because banksters STOLE it all will it? Yacht builders will suffer I know but maybe they could build hospital ships or something.

SS is a Ponzi scheme and I have been lied to ever since I started paying in to SS. The retirement age as increased, the TAX rate has increased AND the income limits have increased since I started paying SS TAX in 1979.

BECAUSE money which would have gone into it at increasing rates was instead put into 401ks where it could be periodically and systematically LOOTED to create wealth for buying yachts and property in the caymens.

If you can't acknowledge private property rights, then there is no point in any further discussion.Turn ALL your money and property over to the state and live 100% off of the work of others. If it lasts that long.

Welcome to the land of the Objectivists, where it's my way or the highway, and neither compromise nor middle ground may be sought. Otherwise known as the land of the false-dilemma, generated by faulty theory and an overall disdain for empirical confirmation.

In reality, there is both private and public property, an always varying middle-ground between central planning and market-price distribution, and private property and public property mutually support the growth of overall value and there are both voluntary and non-voluntary transfers between the two. SSI is one such transfer.

It is perfectly reasonable to suggest that some of the transfers that occur between the public and private sectors are not proper and require reform. But the Objectivist position is that no such transfers between public and private should occur. They deny that the public sector should exist at all. They insist that there should be no common wealth, no common good, and no common interest and. Unreasonable.

Actually, the money's not your property. It says so right on the note. It's the property of the Treasury Dept. You just have certain rights to its use. But you don't have unlimited rights to its use. You can't, for example, withdraw all your money into cash then burn that cash in big barrels. That's a crime, even though it's putatively your money. And it's not a crime because you're polluting the air or you're in a no-burn zone. It's a crime because it's not really your money.

"We need national schemes to ensure that, whatever the level of benefit they may be receiving, claimants can again begin to build on their own provision without being penalised or having to disguise what they are doing. These schemes must promote work, saving, caring and honesty."

"The reforms proposed here would return welfare to being earned rather than awarded after proving need"http://www.newsta...le-graveHope from UK. A 'liberal' that claims welfare must be earned.

No actually, as usual you get all tangled up in semantics. I did work which I was paid for. Most of that compensation was never anything more than digital bits ie info. Info is a real thing. Property.

cant withdraw all your money into cash then burn that cash

"It is unclear if the statute has ever been applied in response to the complete destruction of a bill."

So why isn't the govt to blame for a bad economy by the 'progressives'?

So why isnt ronald mcdonald to blame when you get a bad hamburger?

Economic cycles are as natural as earthquakes but more predictable. Both are inevitable. Govts can enact building codes to protect against natural events. Obviously the worst place for my property is on a island in a river which gets flooded every spring but conservatives forced me to put it there where pirates can get to it (hamburglers?), and then charge me money to move it every year before the thaw. This is called wealth generation.

How exactly can people "earn" welfare when there is not full employment?

To be clear, if there is not a job available to earn welfare with, what exactly do you plan to do with these people? You know damn well there are not enough jobs for everyone, let alone good jobs in this economy.

I'd have no problem creating something like the CCC to ensure there is full employment, but I doubt you'd be okay with that. It's pretty obvious you want people to starve or you honestly believe churches will feed everyone (they all ready don't, it's insane to think this is viable).

To reiterate (as one must do with you) how exactly can people "earn" welfare when there is not full employment?

"The section of the Internal Revenue Code that made 401(k) plans possible was enacted into law in 1978."

"Automatic 401(k)s are designed to encourage high participation rates among employees. Therefore, employers can attempt to enroll non-participants as often as once per year, requiring those non-participants to opt out each time if they do not want to participate. Employers can also choose to escalate participants' default contribution rate, encouraging them to save more."

"ROBS is an arrangement in which prospective business owners use their 401k retirement funds to pay for new business start-up costs."

-Heh. Funny name.

"Unlike defined benefit ERISA plans or banking institution savings accounts, there is no government insurance for assets held in 401(k) accounts"

The govt is bankrupt now with the SS Ponzi scheme and Medicare, both are MANDATORY entitlments which have NOT been funded.Just as most other retirement plans are today, unfunded, as allowed by US govt laws.BTW, no one is forced to invest their 401k contributions in stocks. All plans have US bond options, just as the US govt retirement plans offer. If bonds to pay much, blame the Federal Reserve, a creation of the US govt.

BTW, no one is forced to invest their 401k contributions in stocks. All plans have US bond options, just as the US govt retirement plans offer.

OH NO of course not. That would be crass. They are enticed with matching funds and that 'tax-free' thing. And the bogus promise of wild returns. Which is all great until the crash happens. But that'll never happen again will it? Ive heard that sentiment multiple times since the 70s.

And to manage these accounts with the hope of preserving them, you need to have pros tell you what to do, which costs lots of money. And it costs money to move this money around. Like I say this is your real wealth creation.

And when the markets react as they inevitably do to the collapse phase of an economic cycle, that is CATASTROPHICALLY, these well-paid pros will tell you as only they know how, that it would have been SO much worse without their help. Thanks guys.

"Beveridge was similarly discerning about the question of full employment. The welfare budget could not be balanced if unemployment continued with the role it had played in the lives of too many working-class families during the years between the two world wars. Wartime had shown full employment to be an achievable reality, not merely an aspiration.""Citizens had a duty to get themselves well as quickly as possible and so cease to be a cost to the public purse. To help them achieve this objective, the NHS was not to become an ill-health service.""Beveridge's vision was for an insurance-based welfare state in which entitlement would be earned largely by the function the citizen undertook, either through work or by assuming caring responsibilities. "http://www.newsta...le-grave

"Beveridge's vision was for an insurance-based welfare state in which entitlement would be earned largely by the function the citizen undertook, either through work or by assuming caring responsibilities. "

This is the closest you came to an answer, however far it may be from adequate.

How can someone earn welfare when the entire reason for the existence of welfare is for people who aren't able to earn enough to get by? I'd have no problem whatsoever with the government providing jobs for people in exchange for welfare. Do you?

"Beveridge's vision was for an insurance-based welfare state in which entitlement would be earned largely by the function the citizen undertook, either through work or by assuming caring responsibilities. "

This is the closest you came to an answer, however far it may be from adequate.

How can someone earn welfare when the entire reason for the existence of welfare is for people who aren't able to earn enough to get by? I'd have no problem whatsoever with the government providing jobs for people in exchange for welfare. Do you?

Would he give the same answer as the liar you referenced who claimed a factor of 12 increae in welfare spending in the U.K. since 1948 when there has been practically no increase as a percentage of the GDP?

Poor RyggTard. He just can't figure out that pay as you go systems are funded as required. The money to fund the future of the program is never kept in a valt somewhere, but it is loane out, just as it would be if it were placed in a bank.

"The govt is bankrupt now with the SS Ponzi scheme and Medicare, both are MANDATORY entitlments which have NOT been funded." - RyggTard

Like all Libertarians and Randites, RyggTard just doesn't know how finance works.

"For a few hours, the government spin doctors thought the French, whose deep mistrust of money is rooted in a dual heritage of Catholicism and unreconstructed Marxism, would join in the public shaming. It did not happen. An online poll conducted by the popular Le Parisien tabloid showed almost 70 per cent supporting the country's wayward son and poster boy for glorious political incorrectness."http://www.telegr...ile.html"Belgium's foreign minister says his country will welcome anyone from France who wants to follow actor Gerard Depardieu in escaping higher taxes.

He can run but he can't hide. Here's to a one-world govt and an international tax. It is only a matter of time. Some would say it is already here and has been here for quite some time.

For what is the real difference between warring countries and warring political parties? Socialists vs nationalists - list them all and see that the distinctions become less clear. Borders shift, countries come and go, but the Process continues unabated.

Here's to the Day when the people will no longer have to be divided up and set against each other, when the masses need not be Ruled by contention.

So much Work to do. So little time.

Please sign in to add a comment.
Registration is free, and takes less than a minute.
Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.